March 2, 2012 / 7:03 AM / 7 years ago

India cancels Iran oil shipment due to sanctions

NEW DELHI, March 2 (Reuters) - India’s largest shipping company was forced to cancel an Iranian crude oil shipment last month because its European insurers refused to provide coverage for the vessel because of tightening sanctions against the OPEC member, industry sources said.

The suezmax tanker, Maharaja Agrasen, owned by state-run Shipping Corp of India, was initially booked by refiner Indian Oil Corp. to load Iranian crude oil in mid-February, but could not get the necessary insurance coverage.

The European Union in January announced new sanctions prohibiting European insurers from indemnifying ships that carry Iranian crude and oil products anywhere in the world.

“The European Mutual Protection and Indemnity Club is covering contracts concluded before January 23 on a case-by-case basis up to July 1. They have said they cannot cover contracts finalised after January 23,” said a shipping source with direct knowledge of the deal.

“Shipping Corp concluded the fixtures and applied for a cover which was not extended by the European P&I Club,” he added, referring to a group of maritime insurers. Two shipbrokers also confirmed the tanker cancellation.

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